Two strains of inbred mice, NZB and F/St, have been found to produce high levels of zenotropic murine C-type virus in lymphocytes, but they differ markedly in regulation and site of high virus experssion. In NZB mice highest virus levels are found in bone marrow and spleen and expression is controlled by two independent dominant genes. In F/St mice, the highest frequency of xenotropic virus-producing cells is in thymus, a single locus for induction has been identified (on chromosome 1), and expression is recessive in most crosses with other inbred strains; suppression is controlled by a gene closely linked to H2K. The frequency of this type of control in other strains of mice and the mechznism of regulation are under study. These unique systems provide opportunities to study whether xenotropic virus sequences and their expression play a role in hematopoietic neoplasia.